WH Official: Confidence in Stimulus Helps Economy; ‘We Certainly Notice’ That Dow’s at 10K

ABC News’ Rick Klein reports:

With a new report out this week touting job creation stemming from the stimulus package, Obama administration officials have fanned out to make the case that the $787 billion measure is doing its job.

That's no accident. On ABCNews.com's “Top Line” today, Jared Bernstein, the chief economic adviser to Vice President Joe Biden, told us that perceptions of the stimulus matter.

“Sure — I mean confidence in how the economy is performing both by businesses, families, consumers always makes a difference,” Bernstein said. “But I think the critical kind of kernel of truth in there is that of course the Recovery Act is very much working. We have saved or created about a million jobs thus far.”

“The Recovery Act has clearly helped both on the overall macro-economy side but also on the jobs side. Now that doesn't mean it has offset the massive jobs deficit that greeted us when we got here — by no means. And the president's acutely aware of that. But it is helping.”

Bernstein also said that administration officials pay attention to the Dow Jones Industrial Average, which hit 10,000 this week, though he cautioned that it's only one of many economic indicators of importance to the White House.

Asked if crossing the 10,000 threshold brings a “good feeling” to the White House, Bernstein responded:

“To some extent. The fact is I think the Dow has crisscrossed the 10,000 [mark] multiple times since it bottomed out back in 2007. But I think where your intuition is correct there is that we certainly notice when the market is on an upturning trend, and we appreciate that from the perspective of people who have investments.”

He continued: “Now, I'm not saying that's made up all of the losses by any stretch of the imagination. But we're very interested in the extent to which our interventions and those of the Fed have helped pull financial markets and the overall economy back from the brink. That's what's important there.”

Though Obama aides initially said that the stimulus would keep unemployment under 8 percent, it's now close to 10 percent. Bernstein and other administration officials say, however, that the job market would be much worse without the stimulus, and that the full extent of the economic crisis wasn't evident at the time they made their initial projections.

The report released this week found that 30,383 jobs have been directly created by money spent so far under the stimulus — a number Bernstein said “exceeds our expectations.” The numbers, he said, “point to the conclusion that the Recovery Act did indeed create or save about 1 million jobs in its first seven months.”

“I think you've got to put that [30,383 figure] context. Remember, this report covers $16 billion, OK? We're talking about a $787 billion package; we're talking about direct recipient reporting 30,000 private sector jobs on about 2 percent of the overall bill. And remember, it's just direct jobs — it doesn't count the indirect jobs that you get when people go out and spend that money,” Bernstein said.

“What those numbers suggest is that we are on track to do what we said we're doing through the Recovery Act, which is to help offset some of the very deep pain out there in the labor market,” he said.

Watch the full interview with Jared Bernstein, including a discussion of why the Obama administration wants to give an additional $250 to Social Security recipients this year, HERE.

We also debated the week's politics with Republican strategist Ron Bonjean and Democratic strategist Chris Kofinis.

One hot topic: Is Sen. Harry Reid, D-Nev. — who launched a pair of new TV ads this week, 13 months before the election — in trouble?

Said Bonjean: “When you put up an ad this far away from the elections in 2010, it's a big signal that he's in a lot trouble. And you know frankly, the two Republican challengers right now [who] are in a primary, lead him in the polls. I think you could put a ham sandwich against Harry Reid right now and lead in the polls.”

Kofinis said Reid has to deal with the “conflicting goals” of leading Senate Democrats and seeking another Senate term, but he called it “laughable” and “ridiculous” to suggest that Reid's on the ropes.

As for the ads, “he's not going to have a problem with money, but I think it's also to basically make it less likely that the two challengers can raise money or seem as formidable,” Kofinis told us. “So it's kind of a smart thing to do. But it's a year out — I'm not going to worry about it.”

Watch the full discussion, touching on health care and the search for bipartisanship on Capitol Hill, HERE.

The Note, 6/3/2009: Truth and Consequences — Will words matter in region that’s heard plenty of them?

By RICK KLEIN

With President Obama set to make enemies into friends in the Middle East, what’s the widest gap out there to bridge?

The one between what Vice President Joe Biden is saying, and what the Obama White House wants him to say?

The one between what the interest groups are saying about Judge Sonia Sotomayor, and what GOP senators are prepared to do about it? (Add to that the gap between what Newt Gingrich was saying about her last week, and what he’s saying about her this week.)

The one between what Sotomayor wanted to say, and what she actually said, when asked if she’s a racist?

The one between what Obama said about what he’d consider on healthcare, and what he’d actually consider as president?

Or the one between the honesty the president is delivering abroad, and the honesty that’s being delivered at home?

With the president arriving Wednesday morning in Saudi Arabia, his foreign trip starts with most of the hope he’s used to, and some of the political pitfalls he’s not. There’s such a thing as too much truth, just as there’s such a thing as too close a friend.

His outreach to the Muslim world — to be capped with his Thursday speech in Cairo — carries expectations in the US and beyond that veer close to the unrealistic.

A world waiting for details will again get a long conversation — lectures as leadership, as the president takes the long view.

But words matter perhaps a little less in a region that’s heard far too many of them, from too many US presidents.

And, as always, there are constituencies to balance — foreign and domestic, friendly and not so much.

“Everyone wants peace, but nobody wants to buy a ticket,” Tom Friedman writes in his New York Times column, which highlights an interview with Obama.

“We have a joke around the White House,” the president told Friedman. “We’re just going to keep on telling the truth until it stops working — and nowhere is truth-telling more important than the Middle East.”

Said Obama: “I am going to be holding up a mirror and saying: ‘Here is the situation, and the U.S. is prepared to work with all of you to deal with these problems. But we can’t impose a solution. You are all going to have to make some tough decisions.’ ”

Holding these truths: “President Barack Obama has gotten tough with Israel and chosen Cairo — where President Hosni Mubarak rules with a firm hand — for his much-awaited overture to the Islamic world in what appears to be a clear break from decades of U.S. policy,” the AP’s Steven R. Hurst reports.

“Obama's message in Cairo is intended to reach across the wide Muslim world and continue the outreach he began with his visit to Turkey in April,” ABC’s Karen Travers reports, from Saudi Arabia. “The speech gives the president the opportunity to lay out his vision for a new and improved relationship between the United States and Muslims and continue to move the ball forward on a Middle East peace process.”

“The setting of his speech — the capital of a country that calls itself a democracy but is run as a police state — speaks to the complexities before him. In many Muslim nations, from Lebanon to Afghanistan, where Obama's words also will be heard, extremists are gaining ground,” USA Today’s Mimi Hall reports.

“More than any other president in a generation, Obama enjoys a reservoir of goodwill in the region,” The Washington Post’s Anthony Shadid writes, from Iraq. But: “There is another reality, from hardscrabble quarters of Beirut and Cairo to war-wrecked neighborhoods of Baghdad, where distrust of the United States runs so deep that almost anything it pronounces, however eloquent, lacks credibility, imposing a burden on Obama to deliver something far more than the unfulfilled pledges of Bush's speeches.”

Of expectations: “There are no plans to announce a comprehensive Middle East peace proposal, but Obama's eloquence and telegenic gifts may lose resonance here if he does not articulate at least an overall strategy for delivering a Palestinian homeland,” Jeffrey Fleishman writes for the Los Angeles Times. “His is a mystique of personality and power that is rarely glimpsed among the Middle East's own politicians. And it helps set expectations exceedingly high.”

Coloring the new language: “Behind the scenes, however, Obama has opted to continue signature Bush-era democracy programs and is on track to greatly increase their funding,” Farah Stockman reports in The Boston Globe. “Obama's 2010 budget proposal seeks $86 million for the Middle East Partnership Initiative, a program developed in 2002 by Elizabeth Cheney, daughter of the former vice president, and that promotes training of government officials, entrepreneurs, and activists, up from $50 million in 2009.”

An early endorsement? (Or is there self-interest in having a rooting interest?) Paul Wolfowitz, in a Wall Street Journal op-ed: “He must counter some of the myths and outright falsehoods about the United States that are commonly believed in many parts of the Muslim world, and he needs to present his audience with some inconvenient truths. But he also has an opportunity, based in no small part on his own remarkable career, to make the case that the political principles and values that are sometimes mistakenly labeled as ‘Western’ are appropriate for the Muslim world.”

What can now be said: “The president himself experienced Islam on three continents before he was able to — or before he's been able to visit, really, the heart of the Islamic world — you know, growing up in Indonesia, having a Muslim father — obviously Muslim Americans [are] a key part of Illinois and Chicago,” said Deputy National Security Adviser Denis McDonough, per ABC’s Jake Tapper and Sunlen Miller.

Back on the home front, Judge Sotomayor fans out for day two of the dreaded senatorial meetings, her much-feared photo-op with Senate Majority Leader Harry Reid behind her.

Seeing the writing on the marble hallways: Former House Speaker Newt Gingrich apologizes, sort of. “With these critics who want to have an honest conversation, I agree. The word ‘racist’ should not have been applied to Judge Sotomayor as a person, even if her words themselves are unacceptable (a fact which both President Obama and his Press Secretary, Robert Gibbs, have since admitted),” Gingrich writes in his Human Events newsletter.

He’s hardly on board for the nomination, but: “She has shown more caution and moderation in her rulings than in her words,” Gingrich writes. “So the question we need to ask ourselves in considering Judge Sotomayor's confirmation is this: Which judge will show up on the Supreme Court, the radical from her speeches or the convention liberal from her rulings?”

Who wants to be out there alone? “While Republican senators vowed to ask tough questions about affirmative action and judicial activism, however, few were willing to rule out backing the 54-year-old federal appellate judge,” McClatchy’s David Lightman reports.

“We don’t have enough Republicans to filibuster even if we wanted to, which I don’t think we do,” said Sen. John Cornyn, R-Texas. (Suddenly less optimistic about Norm Coleman’s chances?)

Biography as someone else’s destiny: “I've felt sorry for the poor person in the pit getting grilled,” Sen. Jeff Sessions, R-Ala., tells The Washington Post’s Philip Rucker. “I don't think you'll find that I've abused any witness. And I don't like vindication.”

Said Sessions, after meeting with the nominee: “I'm very impressed with her knowledge, her experience, her energy level. It was a delight to talk with her.”

Confirmation assured? “It could be with 75 votes or it could be with 57 votes, and it depends on whether she assures people,” one Republican Judiciary committee member tells The Hill’s Alexander Bolton.

Reid, D-Nev., speaking the truth, as always: “I haven't read a single one of [her opinions], and if I'm fortunate before we end this, I won't have to read one of them,” Reid said, per The Washington Post’s Dana Milbank.

All over but the timing? “The only area where there was any outward tension in the halls of the Capitol was over the timing of hearings and a vote on her installment to the high court. Republican Senators on Tuesday pushed to have the vetting occur in the fall, while Democrats made clear they were in no mood to draw out the process,” Roll Call’s John Stanton writes.

“But even as Democrats were disciplined in sticking to their main talking point — that Judge Sotomayor would put the rule of law above all else — Republicans began drawing battle lines for a long and potentially confrontational confirmation process that would focus on the extent to which the judge will let her personal background and experiences influence her opinions from the bench,” David M. Herszenhorn and Carl Hulse report in The New York Times.

Vice President Joe Biden’s back on stimulus duty Wednesday, with a noon ET event roundtable with governors co-hosted by Transportation Secretary Ray LaHood.

He continues to stimulate press releases and cable chatter: “Some people are being scammed already,” Biden said Wednesday, Reuters reports.

And wait — the stimulus hasn’t kicked in yet? “You're going to see things start to really change in the second hundred days,” Biden said Tuesday in New York, per the Daily News’ David Saltonstall.

On healthcare — is this a good number, or a not-so-good number? “I'd like to think it was better than that. But . . . having had all the experiences over time that I've had in Congress, I would say it's no better than 50/50,” Tom Daschle said of the chances of healthcare reform passing, per ABC’s Elizabeth Gorman.

Does this help or hurt the odds? “Senate Finance Committee Chairman Max Baucus on Tuesday indicated that President Barack Obama may be warming to the idea of taxing employer-provided health-care benefits to pay for an overhaul of the nation's health system. But the White House, and a key Democratic senator, quickly shot down the idea that the president has had a change of heart,” The Wall Street Journal’s Janet Adamy writes.

Or did he? “President Obama, in a pivot from some of his harshest campaign rhetoric, told Democratic senators yesterday that he is willing to consider taxing employer-sponsored health benefits to help pay for a broad expansion of coverage,” Ceci Connolly reports in The Washington Post.

“Yeah, it's something that he might consider,” said Baucus, D-Mont. “That was discussed. It's on the table.”

On the other fun piece of the equation: “Senator Sheldon Whitehouse of Rhode Island, one of two dozen Democratic senators who met with Mr. Obama, said the president ‘spoke very enthusiastically about a public plan’ that would compete directly with private insurers,” Robert Pear and Sheryl Gay Stolberg report in The New York Times.

Sen. Ted Kennedy, D-Mass., checked in with the White House Tuesday — but isn’t back at work yet: “Senator Kennedy is doing a good job at balancing his work on health care reform with his treatment plan, but he's not planning to be back on the Hill this week,” spokesman Anthony Coley said in an e-mail to The Boston Globe’s Lisa Wangsness.

When is a retirement nothing of the sort? “Tim Pawlenty claimed Tuesday to have no plans after his governorship beyond cutting the lawn and watching his daughters play sports,” Mark Brunswick reports in the Minneapolis Star Tribune. “But few believe the political journey is over for this 48-year-old son of South St. Paul, whose up-by-the-bootstraps narrative has potential to beguile a national Republican Party searching for a winning direction.”

“Although he says he doesn’t know what his plans are or what the future holds for him, none of us should be too surprised if we see him touching down in Iowa, New Hampshire, or South Carolina before too long,” ABC’s David Chalian writes.

On that lingering piece of business, that might someday give Minnesota a second senator again: “I’m going to do whatever the court says. If the court directs me to sign that certificate, I will,” Pawlenty said.

In New Jersey — it wasn’t close. “Chris Christie, the former U.S. Attorney whose aggressive pursuit of political corruption in New Jersey led to the downfall of some of the state's most powerful elected officials, won the Republican nomination for governor last night, beating back conservative Steve Lonegan in an unexpectedly bloody, hard-fought primary campaign,” the Star-Ledger’s Josh Margolin and Claire Heininger report. “Christie's victory sets the stage for what could be the most competitive gubernatorial race in more than a decade, as he takes on incumbent Gov. Jon Corzine in November.”

The statement from RNC Chairman Michael Steele: “By selecting Chris Christie as their nominee, New Jersey Republicans signaled they are ready for a Governor that will work hard to create jobs, protect small business and turn New Jersey’s economy around. . . . Chris offers New Jersey Republicans and Democrats alike the chance to break with Jon Corzine’s failed Wall Street policies and once again make New Jersey’s cities and small towns engines for economic growth.”

From the Democratic Governors Association’s executive director, Nathan Daschle: “One after another, though, Christie’s personal and professional ethical problems came to light — undermining the entire foundation for his candidacy. From allegations of ‘pay-to-play’ contracting to telling voters the truth, Christie’s lapses show, at best, a troubling lack of judgment and, at worst, a deeply eroded moral compass.”

Day Three of the “America’s Future Now” conference is Wednesday. Two days into the straw polling among progressives, some early results from Greenberg Quinlan Rosner: “While participants found a lot to like in the first 100 days plus, they are very focused on health care as the highest priority: 42 percent say it should be the President’s top priority, with all other responses in the teens. And while the participants strongly support the president and his priorities, 62 percent say they will not support a health care plan without a public option for health insurance, even if that was the only way to get the planned passed.”

Plus: “While two thirds of conference attendees (67 percent) favor Congressional investigations into the practices of the Bush Administration in their handling of suspected terrorist suspects, an even stronger majority (81 percent) would like to see Congress investigate the fraud and excesses of Wall Street that led to the financial crisis.”

Next for the Edwards family: “Elizabeth Edwards plans to open a furniture store in Chapel Hill this October, the Chapel Hill/Orange County Visitors Bureau reports,” per the News & Observer’s Mark Schultz. “Edwards has leased space in Rosemary Village at 400 W. Rosemary St. downtown, near the Greenbridge condo towers. The store, called Red Window, will feature a mix of styles and prices patterned after a charity store called The Red Door that her mother managed when she lived in Japan, the visitors bureau says.”

And ABC’s John Berman runs for president — with the help of Democratic strategist Chris Lehane and Republican strategist Kevin Madden. (A team with a batting average that’s better than David Ortiz’s.)

The Kicker:

“I am a lefty.” — President Obama, to former First Lady Nancy Reagan, making up for a perceived snub.

“We had to figure out how to deal with a former president who was just lying, engaging in bald-faced lies.” — President Obama, in the new Richard Wolffe book, on that other lefty, former President Bill Clinton.

Today on “Top Line,” ABCNews.com’s daily political Webcast: Rep. Kevin McCarthy, R-Calif.; and Ana Marie Cox of Air America.

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For up-to-the-minute political updates check out The Note’s blog . . . all day every day: http://blogs.abcnews.com/thenote/

Politics Live: Biting the Hand That Feeds You?

The California Assembly reached a budget deal in the 11th hour to address their gigantic $42 billion state deficit. Still, California Governor Arnold Schwarzenegger, and many other governors, are looking for a share of the new stimulus bill set aside for grants to the states to help them bridge their deficits.

But, several GOP governors are saying they don’t like the idea, including Gov. Rick Perry, R-Tex., Bobby Jindal, R-La. and Gov. Sarah Palin, R-Alaska.

What is going on? Does this have anything to do with a potential 2012 run for the White House? For more detail, tune into Thursday’s edition of Politics Live with ABC News’ Sam Donaldson, David Chalian and Politico’s National Politics Editor Charles Mahtesian.